France pushes ‘made in Europe’ drug labels

LYON, France — France is pushing for new labeling on medicines showing whether the contents were made in or outside Europe, a move to bolster its pharmaceutical industry, but one that could sow discord among drugmakers reliant on Asian suppliers.

The French economy ministry notified the European Commission on October 6 of the government’s plan to pass a decree on the topic, in a filing seen by POLITICO. The health ministry backed the proposal, arguing patients need more transparency on the origin of the drugs they take.

But the real motivation is business, industry insiders say. Drugmakers with manufacturing plants in France have long pushed for the labels because they hope these would give them an edge with both patients and public payers who may prefer to support locally made products. The label designed by the government would mark ingredients made outside Europe — generally in China and India — with a black cross.

“We have in Europe a know-how, a tradition, an expertise as well as specific environmental constraints that are tighter than in some countries,” Christian Lajoux, head of the French pharmaceutical trade group Féfis, told POLITICO. “It would be nice if this know-how could finally be recognized with a pictogram; that would encourage players to make their products in the countries with the best practices.”

However, the European Federation of Pharmaceutical Industries and Associations (EFPIA) representing the Continent’s biggest drug companies – many of which import ingredients from outside the EU – was not thrilled.

“EFPIA believes that the legislation in place, which ensures that all medicines marketed within the European Union comply with the same EU standards, should already guarantee safe and good quality medicines in EU,” a spokesman said in an emailed statement.

“A better approach would be to focus on enforcing the current legislation and standards and ensuring that they are being adhered to. Linking country of origin to level of quality can be very misguiding, as there are many examples of manufacturing plants in India that have higher quality standards than some in Europe,” he said.

Back in Paris, the health and economy ministries told POLITICO in a joint emailed statement that the French pharmaceutical industry was eager for this measure, and that the move had not sparked any particular reaction at the EU level.

“We must reinforce the faith of our fellow citizens in the quality of their medicines, about which doubts remain in the public opinion. It has appeared necessary to promote transparency in this field, by informing citizens of where the different stages of drug manufacturing take place,” they said.

‘A label on quality’

France’s move comes just months after Europe banned 700 generic drugs made in India over flaws in their clinical trials, prompting India to retaliate by freezing talks on a free trade agreement with the EU. The scandal has fueled a long-running debate over the oversight of pharmaceutical products imported into the EU and the United States.

According to EU rules, the authorities of non-member states are responsible for certifying that the active pharmaceutical substances produced on their soil and imported into the 28-nation bloc are manufactured in ways that comply with good practices equivalent to those of the EU.

“Now, many of our fellow citizens do not have the same trust in the competent authorities of non-Member States as they do in the competent authorities of the European Union. This gives rise to a lack of faith in the quality of medicinal products and generic medicinal products in particular,” France argued in its filing.

The pictogram, as presented by the government, would be a rectangle divided into four parts, each identifying a specific stage of drug manufacturing: “Excipients” (inactive ingredients like coating or coloring agents), “Active substance” (the core, active components of drugs), “Production” (assembling the ingredients to produce the final drug) and “Packaging.” Each section would have the word “Europe” in white on a blue background if that stage of manufacturing, production or packaging took place in the EU or in the European Free Trade Association. Otherwise, it would bear a black cross.

The decree would only allow, not force, drugmakers in France to print the notice on their packaging. The idea dates back to July 2013, when representatives of the French pharmaceutical industry and the government signed an agreement on a series of measures aimed at boosting a domestic sector reaping €75 billion in annual revenue and employing more than 200,000 people.

“When we proposed this pictogram, the ambition was to reindustrialize the country in terms of pharmaceutical production. The idea was to put a label on quality,” said Lajoux of the Féfis trade group.

Among the measures agreed back then to support the industry, the pictogram was listed alongside efforts to “set up hospital procurement policies favorable to employment, growth and competitiveness.” In other words, the hope was that a manufacturing process labeled as local could earn drugmakers brownie points for public tenders, especially for large contracts with hospitals.

It took more than two years for France to come up with draft legislation on this label.

“This measure raised a lot of questions because it could have appeared as wanting to favor products made in one place rather than another … I think what took time to implement it was making sure that this pictogram was compatible with EU policies,” Lajoux said.

Under the EU’s Transparency Directive, a member state preparing regulation in the area of industrial goods must report its draft legislation to the Commission and member countries to allow them to object if they consider the plan breaches EU rules or creates trade barriers. The notification triggers a three-month standstill period during which the draft law should not be adopted.

Lucia Caudet, a spokesperson for DG Grow, which handles these questions at the EU level, said the Commission’s assessment of the French legislation is “ongoing” and that she could not comment further on it at this stage.

“We’ve had absolutely no feedback at the European level so far,” said Léopold Berthier, in charge of industrial affairs at GEMME, a trade group of French generic drugmakers that mainly produce in Europe and support the label. But the Commission has “no reason” not to back the move, he argued: “This is a voluntary measure, it doesn’t force anybody; it only fosters more information and more transparency. We’re hoping it will pass.”

‘Nothing to hide’

EFPIA could not provide data on the proportion of its members producing mainly in the EU and those outsourcing most of their processes outside Europe.

Industry analysts estimate that more than half of active pharmaceutical ingredients consumed in the EU come from China and India.

However, the assembling and packaging of medicines remain “a largely local and European business,” said Berthier.

This means that, if drugmakers embrace the proposed labels, patients in France should expect to see a mix of black crosses and blue boxes on the packaging of their medicines.

Generic drugmakers are often asked by authorities to purchase their ingredients from various sources to prevent supply shortages, Berthier added: “We may have a source in Europe and one in India … That would mean we’d have different labels for each batch, depending on where the active ingredient came from.”

Some consumers are skeptical of generics, even though EU health regulators approve them as having the same safety and effectiveness as their branded counterparts.

Only 68 percent of the French trust generic drugs, compared to 89 percent for brand name drugs, according to the latest survey carried out by the French pharma lobby Leem.

Generic medicines accounted for less than one in three reimbursed drugs sold in France last year, according to GEMME data. In contrast, they accounted for more than three in four drugs reimbursed in Germany and the U.K., according to the OECD.

“We need to give people more confidence in their drugs, by showing that we have nothing to hide,” said Berthier.